Conservative Policies under
Reagan and Bush
Chapter 25, Section 2 Notes
Objectives
• Summarize Reagan’s economic
programs.
• Describe the changes that occurred
in the makeup and decisions of the
Supreme Court
• Identify results of deregulation
• Analyze the presidential elections of
1984 and 1988
Main Idea and Terms/Names
•Presidents Reagan •Reaganomics
and Bush pursued a •Supply-side
conservative economics
agenda that •SDI
included tax cuts, •Sandra Day
budget cuts, and O’Connor
increased defense
•Deregulation
spending
•EPA
•Geraldine Ferrara
•George Bush
Reaganomics
• Reagan won election of 1980
• New Economic Plan – Reaganomics
– Budget cuts
– Tax cuts
– Increased defense spending
• Wanted to reduce size and influence
of federal government
– Encourage private investment
Budget Cuts
• Downsize federal govt through
cutting out social programs
– Save money
– Did not effect middle class entitlement
programs
• Congress slashed budget of food
stamps, mass transit, welfare,
student loans
Tax Cuts
• Supply-side economics
– If people pay less in taxes, they will save
money (in theory)
– Banks could loan that money to
businesses
– Businesses are the base of prosperity
• US Govt lowered income taxes by
25%
• “Trickle Down” Theory – more rebates
to rich - $ would trickle down
Increased Defense Spending
• Reagan doubled the defense budget
• Strategic Defense Initiative (SDI)
– Defense system to protect Americans
from enemy missiles
– Known as “Star Wars”
– System would cost trillions of dollars
Recession and Recovery
• Economy had sunk into recession
– Worst since Great Depression
• 1983 – Economic upturn leads to
recovery
National Debt Climbs
• Economy still had problems
– Tax cuts helped the rich
– Social welfare cuts hurt the poor
– Federal spending was larger than
income – deficit
– National debt doubled during
Reagan’s first term
Supreme Court
• Reagan nominated conservatives to
Supreme Court
– Sandra Day O’Connor
Scalia
– Antonin Scalia Kennedy
– Anthony Kennedy
O’Connor
• Bush continued the trend
– David Souter
– Clarence Thomas
Thomas
Souter
Supreme Court
• Conservative William Rehnquist was
Chief Justice
• Ended liberal control of the court
– Restricted abortion
– Restricted civil rights
– Narrowed rights of accused
DeRegulation
• Deregulation – cutting back of
federal regulations of industry
– Reagan removed price controls on oil
– Eliminated federal health and safety
inspectors for nursing homes
– Deregulated savings and loan industry
• Increased competition and lowered
prices for consumers
DeRegulation
• Reagan cut the EPA’s budget
• Government sold public land to
private developers
• Opened continental shelf to drilling
– Risks?
• Cut timber in national forests
Election of 1984
• Reagan had a conservative coalition
– Business – liked deregulation
– Southerners – liked small fed. govt
– Westerners – liked less environ.
restrictions
– Reagan Democrats – Dem. too liberal
• 1984 – Reagan/Bush v. Walter
Mondale/Geraldine Ferraro
• Reagan won by a landslide
Election of 1988
• George Bush (Reagan’s VP) v.
Michael Dukakis (Gov. of Mass.)
• Economy was strong –no reason for
change
• Bush was part of moral majority
• Bush – “no new taxes”
• Bush ran negative ads – low voter
turnout
• Bush wins…53% of vote